In Korea: Trade Pact’s Strong Defense of Intellectual Property Rights

The National Association of Manufacturers’ Doug Goudie has been reporting from a business and trade mission to South Korea.

Our delegation had a long day of back-to-back high level meetings with a variety of senior officials today, as well as a tour of a GM-Daewoo auto assembly facility. Many of the meetings are off-the-record and I won’t abuse the trust. I will say we served American beef at all our meals with senior Korean officials.

Suffice to say, the U.S. business community is still sounding our strong support and outlining the strong benefits manufacturers in America will see from the market-opening provisions in this agreement (as I outlined in my initial post for Monday).

Rather than end there, we’ve seen and done a lot here so far, and I thought I’d look at a few specific examples and thoughts that have come up so far.

Intellectual Property Rights:  The NAM takes a strong stand on robust protection of intellectual property rights (IPR). IPR protection extends far beyond counterfeiting or piracy, of course – innovation is one of America’s greatest competitive advantages and is our key to remaining the cutting-edge manufacturing center in the world.

In discussions with Korean officials this week, we’ve heard them express the same fears about Chinese IPR violations that we hear in America. In the 1980s, Korea had a reputation for lax IPR protections, particularly in counterfeiting and piracy. This is no longer the case – China and some other Asian nations are the offenders now- but if anyone is still concerned, the Korean-U.S. Free Trade Agreement (KORUS FTA) has extremely strong IPR language written into it. (Chapter 18)

I went shopping first day into some of the markets, looking for counterfeit consumer goods. Not to buy, mind you!  Knock-offs still abound in handbags and luggage at the market I visited — I won’t deny that fact — but they are obvious knockoffs that wouldn’t fool my 3 year old daughter, let alone a Real Housewife. For example, “Conch” bags bear a resemblance to “Coach”.

You can buy those noted Italian brands “Fendli” and “Gocci” or French brands “Cristin Dios” (Dior) or “Hormes” (Hermes). Along with altered names, the logos are reminiscent of the trademarked originals but not identical reproductions – Fendli has an interlocking F and L instead of Fendi’s Fs, Gocci’s Gs are reversed in their logo from the real Gucci. The Chanel Cs have vertical lines extending from the open ends. And so on.

I certainly don’t mean to be dismissive – knockoffs violate trademarks, branding and design that are all supposed to be under protection of law, and everything I saw in the market is against IPR provisions in the United States. They also would be against the law with the IPR provisions of the KORUS agreement.

The point I want to make is that the KORUS agreement contains a gold-standard IPR chapter which goes further than any other FTA we have signed. It goes further than the EU agreement with Korea in many ways. It adds stringent new protections that will be unparalleled in a bilateral FTA, and will serve as a foundation for future bilateral FTAs and for regional agreements like the Trans-Pacific Partnership (TPP).

These IPR provisions touch the very foundations of what will make America competitive far into the future. The innovation that leads to new technology, software, hardware, e-commerce, entertainment, pharmaceuticals, energy, entire new industries – all are hallmarks of the future of manufacturing in America. All are protected by the IPR provisions in the KORUS FTA. And with passage of the agreement, the United States will have a new foundation for protection of intellectual property.

So, no knock-off purse for my wife as a gift from the trip. But I did find some lovely Korean jewelry and pottery instead. She’d look funny boasting about the $30 Gocci bag anyway.

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